Nigerian Stock Exchange’s (NSE) ranking as the third best performing Exchange in the world for 2017 has continued to pave way for more international recognition and bi-lateral ties for the country, as the United States (U.S.) Consul General, F. John Bray, yesterday described Nigeria as one of its most important partners in Africa.
Nigeria’s stocks have been among the world’s best performers in the past four months, and foreign investors are a big reason for that, Bloomberg reported yesterday.
According to the News Agency of Nigeria (NAN), the New York-based financial software, data, and media company, said net foreign inflows to Nigerian equities totaled N337 billion ($940 million) last year, the first time flows have been positive since at least 2013.
Bray, while addressing stockbrokers during the ‘Bell Ringing Ceremony’ on the floor of the NSE yesterday affirmed that the agreement was a clear message that the US and the private sector is committed to supporting Nigeria as it continues to find new avenues of economic growth and development.
“I know that last year was a very successful year as the NSE was ranked amongst the top five performers in 2017; projections indicate that 2018 will be an equally successful year. Let’s hope that’s the case, for the growth of the NSE means more private capital in the local market for business expansion and new business start-ups.
“I am here today to express the U.S. government’s deep commitment to Nigeria’s private sector and economic growth. The more Nigeria’s economy grows, the better it is for both Nigerian and American businesses.‘’ He said the U.S. government maintains a limited number of BNC relationships with nations, as it demonstrates a high degree of friendship, trust, and cooperation, rating Nigeria as top among such nation.
Furthermore, The Guardian reported he stressed the need for exchanges to operate in an open and transparent manner, adding that such financial exchanges are an example of a society’s broader commitment to the rule of law and sanctity of contracts.
Already, U.S., during the Bi-National Commission (BNC) meetings in Abuja last November had underscored the need to strengthen and revitalise the BNC to advance both nations overall relationship.Bloomberg said December 2017 was the best month since it started compiling data at the beginning of 2014, with net inflows of N140 billion, signaling a switch in sentiment toward equities in Africa’s biggest oil producer.
The finance media company said foreign investors were heavy buyers of Nigerian shares last year.The world-beating rally in Nigerian stocks might not be over yet, noting that the main equity index in Africa’s biggest economy had surged 12 per cent in the first two weeks this year in dollar terms, the most among 96 major bourses tracked by Bloomberg, pushing it to the highest level since 2008.
It said the advance would probably be sustained thanks to rising prices for oil, Nigeria’s main export, and as investors look to increase their holdings of what remained among the cheapest stocks in Africa.
“While the central bank eased some capital controls last year and opened a trading window for foreign portfolio investors, it continues to operate several exchange rates.”It warned, however, that Nigeria’s multiple exchange rate system was likely to remain a key drag, keeping long-term investors on the side lines.
Meanwhile, in just two trading days- Friday and yesterday, the Central Bank of Nigeria (CBN) made a $514.4 million intervention in the foreign exchange (forex) market.Of the amount, the sum of $210 million was sold yesterday in various segments of the inter-bank market, as a boost to the weekend’s offer of $304.4 million.
Consequently, the local currency has traded stably in the past four trading days till date, hoving around N305 and N305.70 per dollar at the official segment; N364 at the parallel market; and N360-N360.37 at the popular Investors’ and Exporters’ (I&E) Window.
Similarly, the continuous intervention and resulting increased liquidity have spurred investors- local and international, to increase their bet in the economy, as yesterday transactions showed an average deal of $655.72 million at the I&E segment, according to FMDQ OTC Securities Exchange data.
Specifically, CBN offered $100 million as wholesale interventions and also allocated $55 million to the Small and Medium Enterprises (SMEs) forex window, while requests for Business/Personal Travel Allowances, tuition and medical fees, among others, got $55 million.